The effect of the feed-in-system policy on renewable energy investments: Evidence from the EU countries

Mutaka Alolo, Alcino Azevedo, Izidin El Kalak

Research output: Contribution to journalArticlepeer-review

Abstract

We study the effect of the Feed-in-System (FIS) policy on wind and solar photovoltaic energy investments in the European Union (EU), over the time period between 1992 and 2015, considering the heterogeneity of the policies and market conditions across the EU countries. We develop a FIS subsidy performance indicator that distinguishes feed-in-tariff (FIT) from feed-in-premium (FIP) and considers other important aspects of each of these contracts, such as the duration, tariff price, energy spot price and production costs, as well as the market conditions. We conclude that the mere existence of the FIS policy does not necessarily enhance renewable energy investments, it depends on the type of the FIS contract and its features, and may vary across the different sources of renewable energy. Some of our findings are new to the literature and can have important implications in the development of new public investment incentives to promote renewable energy.
Original languageEnglish
Article number104998
JournalEnergy Economics
Volume92
Early online date28 Oct 2020
DOIs
Publication statusPublished - 28 Oct 2020

Bibliographical note

© 2020, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/

Keywords

  • European union
  • Feed-in-System
  • Feed-in-Tariff
  • Renewable energy
  • Solar photovoltaic
  • Wind energy

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